Latest Press Releases

In July this year, the minimum wage rose to 10.45 euros gross per hour. In October, the minimum wage will be raised further to 12 euros. A study by ZEW Mannheim on behalf of the German Minimum Wage Commission now shows that the introduction of the minimum wage in 2015 as well as the first increase in January 2017 hardly caused any companies to exit the market. The researchers also observed that it even made some sectors become more productive, promoting competition overall.

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As a result of the COVID-19 pandemic, firms in Germany expect a strong increase in the amount of working time performed from home in the long term. As a recent business survey by ZEW Mannheim shows, firms in the information economy expect an average of 24 per cent of their employees’ working time to be done from home after the pandemic. Before the pandemic, this share was only 9 per cent of working time. Meanwhile, in the manufacturing industry, the average proportion of time worked from home doubles from 3 per cent before the pandemic to 6 per cent afterwards. “Small, medium and large firms all expect a significant increase in the share of working time from home. However, the expected shift to working from home is most pronounced in large firms,” says Dr. Daniel Erdsiek, researcher in ZEW’s “Digital Economy” Department.

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Since the start of the Russian-Ukrainian war, EU countries have recognised the urgency of reducing their energy dependence on Russia while protecting European households and businesses from rising energy costs. Joint procurement of natural gas would address this dual problem. EU-wide procurement would be an efficient means of preventing energy price spikes, as a recent ZEW policy brief shows.

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The deputy head of the Research Department “Labour Markets and Social Insurance” at ZEW Mannheim, Professor Melanie Arntz, has been appointed as a member of the “Rat der Arbeitswelt” (“Council of the World of Work”). The independent and interdisciplinary expert commission has the task of preparing an annual report on the world of work, which is handed over to the Federal Ministry of Labour and Social Affairs (BMAS).

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The spatial distribution of economic activity in West Germany has changed significantly over the last 100 years: In the past, the country’s northern regions used to possess economic power, high wages and traditional industries. Over time they have experienced severe deindustrialisation and have fallen behind in the ranking of regional gross domestic product. Examples of this trend include the Ruhr area but also Bremen and other coastal regions. However, many regions in the south of Germany, especially in Bavaria, have managed to make the transition from relatively backward, agricultural regions into new, innovative industrial hubs. A recent study by ZEW Mannheim in cooperation with the University of Bayreuth attributes this transition to regional differences in the early industrialisation in the 19th century. These differences explain almost half of the North-South divide in per capita income between regions in Germany today.

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The German economy will grow only moderately by 1.5 per cent in 2022, according to the assessment of the financial market experts surveyed by ZEW Mannheim in July 2022. Compared to April 2022, the respondents have revised their forecast for 2023 downwards from 2.5 to 1.5 per cent. The experts do not expect the economy to accelerate before 2024, when growth is expected to reach 2.0 per cent.

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Professor Irene Bertschek, head of the Research Department “Digital Economy” at ZEW Mannheim, has been appointed as a member of the newly established Future Council on behalf of German Chancellor Olaf Scholz. The Future Council is replacing the previous Innovation Dialogue between the Federal Government, industry and science. It aims to monitor developments, insights and trends in the field of innovation and to develop proposals to strengthen Germany’s resilience and technological sovereignty in key technologies and digitalisation. The council consists of high-ranking representatives from science and business.

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The ZEW Indicator of Economic Sentiment for Germany slumped by 25.8 points to a value of minus 53.8 points in the current July 2022 survey. The assessment of the economic situation in Germany has also decreased sharply and currently stands at minus 45.8 points, 18.2 points lower than in the previous month. Both the assessment of the economic situation and the expectations are thus even slightly below the values recorded in March 2020 at the beginning of the COVID-19 crisis.

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With increasing digitalisation in Germany, the importance of one’s social background for professional success has diminished. In the 1990s, the increasing computerisation of the work environment made it easier for employees whose parents did not have a German high school diploma (“Abitur”) to access jobs that were subject to major technological change. Moreover, their wages in these occupations converged with those of workers whose parents had a high school diploma, as a recent study by ZEW Mannheim shows.

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The European Central Bank (ECB) published the results of its climate risk stress test, which it conducted for the first time for 104 banks in the euro area. Dr. Karolin Kirschenmann, deputy head of the Research Department “Pensions and Sustainable Financial Markets” at ZEW Mannheim, has commented on this matter:

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